Star Equity Fund, LP (“Star Equity Fund”, “we”, “our”), a shareholder of Servotronics, Inc. (NYSE American: SVT) (“Servotronics” or “the Company”), seeks to unlock shareholder value and improve corporate governance at its portfolio companies. On May 24, we issued a press release urging Servotronics shareholders to vote WITHHOLD on the re-election of incumbent board members Ed Cosgrove and Lucion Gygax due to their enablement of—or at best failure to see—malfeasance occurring at Servotronics. On June 10, Servotronics held its 2022 Annual Meeting of Shareholders, and the majority of the Company’s shareholders voted with our recommendation: a staggering 54% and 51% of votes cast voted WITHHOLD on Cosgrove and Gygax, respectively. In addition, the majority of shareholders voted against the approval of the Company’s 2021 executive compensation in a non-binding vote, another sign of significant shareholder frustration.
Servotronics shareholders have made it clear that neither Cosgrove nor Gygax has their support, and we call on both directors to resign from the Servotronics board immediately. In fact, many companies have auto-resignation provisions in their bylaws whereby directors must resign if the withhold vote is greater than 50% of all votes cast. Should both directors remain on the ballot in 2023, we will strongly consider nominating alternative directors to run against them. We will continue to monitor the Company’s progress and will remain ready to act if progress on improving shareholder value and shareholder rights is not made. Although we are pleased that shareholders voted in solidarity with our withhold vote campaign, there is still more work to be done. We fully expect Servotronics’s board and management to act quickly to add value, improve operating and financial performance, and improve corporate governance.